PROCUREMENT POLICY COUNCIL April 22, 2009 9:00 am to Noon
PPC AGENDA • Finance Transformation – Jeff Mandel & Randy Schmoyer • BMWBO –Millicent Brown and Beth Nonemaker • Materials - Walt Quade • Services – Roxana Dietz • PCI & PIBH Presentation – Betty Goodling and Al Baker • SRM – Joan Kraft, Cheryl Kleeman and Sue Rojas • Customer Support Center – Mike Starr • E-Alert Project – Sue Plecker • Legal – Chuck Anderson • Training – Jeff Mandel • Green Procurement – Paul Wolf • UNSPSC – Paul Wolf • Thresholds – Jeff Mandel
Bureau of Payable Services The Bureau of Payable Services will manage the accounts payable function across the Commonwealth in a centralized structure, allowing for the implementation of standardized processing and procedures that will facilitate monitoring and control while improving transaction time. Contracts Division • The Contracts Division will manage service RFPs, contracts, purchase orders and grant agreements across the enterprise in a central unit. Invoice Processing Division The Invoice Processing Division will review, verify, and process enterprise-wide Purchase order (PO) and Non-PO invoices, including grants, agency- and comptroller-generated invoices, and manage exception processing in a central location. The division will be divided into: • PO Processing, which will occur in units based on work distribution and have supervisors overseeing a team of processors. • Non-PO Processing, which will have a Pcards / Advancement accounts payment group, and customer-based units. Bureau of Payable Services Exception Processing, which will include a Quality Control unit that works with Dept of Revenue to scan and index invoices before any information gets into SAP and address issues with invoices that have been entered into SAP that the PO and non-PO group cannot complete because of additional effort required. Payable Services Center (PSC) Division The PSC Division will serve as the primary point of contact for Commonwealth external vendors. The division’s main responsibilities include: handling vendor activities (W 9’s, 1099’s, Replication, master vendor file support corrections), issuing resolutions through the call center, maintaining vendor data across the enterprise, scanning documents (such as Contracts) that are not scanned centrally by the Department of Revenue, and providing mailroom support for all of the Comptroller Organization.
Procurement Announcement Form • Required for Service Procurements between $20,000 - $250,000 • Required for all Independent Agencies that are not required to obtain DGS delegation • If Service Procurement is anticipated to be greater than $250,000 the DGS “Request for Delegation Form” should used instead of this form
Procurement Announcement Form • Form can be obtained from: DGS Website – Procurement Forms • Submit Form to: AgencyServiceProcurements@state.pa.us
Finance Transformation • The new approval process will take effect May 11th . Change to the invoice mailing address took effect April 15th . • Any service related IFB, RFP, PO or contract that was published and released for approval prior to May 8th will continue to use the current approval process as long as no further changes are initiated in the document. If changes are initiated after May 11th and the document is republished it will follow the new approval process. • Any SRM PO that was created prior to May 11th, rejected and the PO was changed and republished after May 11th will go through the new approval. • Any service related IFB, RFP, PO or contract that was created prior to May 8th but not published for approval until after May 11th will use the new approval process. • CRP-Thresholds for new contracts and invoices CRP review will be reduced from $10,000 to $5,000 effective 5/11/09 as per MD 219.9.
BMWBO Contract Compliance Program STD-21 Initial Contract Compliance Data
Procurement Handbook Part 1 Ch.3 • Contract Compliance Program. The purchasing agency must ensure that all non-construction contractors contracts $50,000 and above and all construction contractors that are awarded contracts $100,000 and above, receive the STD-21Compliance Review Form.
BMWBO Contact Info • www.dgs.state.pa.us • Doing Business w/ Commonwealth • Contract Compliance (CC) • DGS, BMWBO • Charlie Poticher, CC Officer • Beth Nonemaker, CC Equal Op Spec • Tel. 717-346-8104 or 717-783-5034 • Gsfirstname.lastname@example.org
Pilot Program Purpose: To allow small businesses to bid without competing with larger more established businesses AND to increase economic opportunities for small businesses, including minority and women-owned small businesses. Known also as “set a sides” in other states.
Definition of Small Business 1. Contractor is not a subsidiary of another firm. 2. Contractor is not dominant in its field of operation. 3. Contractor employs no more than 100 person 4. Contractor had less than $20,000,000 in gross annual revenues in each of its last two fiscal years 5. If Contractor is new business (less than 1 year), Contractor has an approved business plan by the Small Business Development Center or by a Pennsylvania Enterprise Center authorized by the Minority Development Agency of the United States Department of Commerce.
Small Business Reserve Current States/ Entities Utilizing SBRs * Federal Government * District of Columbia
Proposed Implementation of SBR • Target Date →→→ Third Quarter 2009 • Agencies helping in this pilot program include, but are not limited to L&I, DPW, DEP, and DCNR. • SBR Work Group is considering having this go into effect for approximately 20 procurements. • On-line Self Certification for Small Businesses is currently being developed. • Immediate goal is to determine the feasibility of such program for the Commonwealth. If successful, we hope to have 10% of all agency procurements placed in SBRs by July 2010.
Pharmacy Contract • Current MMCAP Contract to expire June 1st, 2009 • We have contracted with McKesson to supply our prescription drugs beginning June 1st, 2009 • This represents a savings of $2,500,000 annually to COPA using agencies • The basic contracting procedures remain the same • Training on the new website will begin the week of April 20th, 2009 • MMCAP contract for other Medical Supplies remains in place
Systems Furniture Contract • Multiple Award - 17 suppliers. • If cost is < $50,000 Agency may order. • If cost between $50K to $1M Agency conducts an RFQ to all suppliers on contract and include MBE/WBE participation requirements. • Cost > over $1M Agency must send the shopping cart to DGS-BOP for review and possible bid. This will include a MBE/WBE submittal.
2008 Supplier Rebates cont’d • Lowe’s and Grainger Rebate arrived in February 2009. • Lexmark and VWR Rebates arrived in April 2009. • Checks were hand delivered to the Department of Revenue with the accompanying Agency Distributions. • The Department of Revenue credited your Agency account GGO for the amount indicated.
Sweatshop Provisions Procurement of Apparel or Apparel Laundering Services “Apparel" is defined as: "Products manufactured, woven, cut, sewn or otherwise similarly processed by mechanical or human effort from fabrics, leather, or cloth made for use as clothing, shoes, or other attire.“ • CERTIFICATION Required By Executive Order 2004-4 Anti-Sweatshop Procurement Policy • Eligibility. To be eligible for award, a bidder [or offeror] must submit the following items with its bid [or proposal], or no later than two (2) business days after notification from the Department of General Services [or other purchasing agency]: • A certification, in the form included with this invitation for bids [or request for proposals] signed by an individual authorized to make the certifications on behalf of the bidder [or offeror]. • A list of each proposed facility to be utilized in the manufacture of the apparel or the laundering of the apparel, including subcontractors, with business name, address, contact person, and telephone number where such work will be conducted. • Failure to provide this required information prior to the expiration of the second business day after notification shall result in the rejection of the bid [or proposal].
What is a Sweat shop? • A sweatshop is a working environment with conditions that are considered by many people of industrialized nations to be difficult or dangerous, usually where the workers have few opportunities to address their situation. • This can include exposure to harmful materials, hazardous situations, extreme temperatures, or abuse from employers. • Each and every employee used in connection with the manufacturing or laundering of apparel will be paid an hourly rate at least equivalent to the Poverty Threshold. • Sweatshop workers often work long hours for little pay, regardless of any laws mandating overtime pay or a minimum wage. • Each and every employee used in connection with the manufacturing or laundering of apparel will be provided with working conditions that meet or exceed the International Labor Organization Convention's ("ILO") standards. • Governing forced labor, child labor, payment of wages, hours of work, occupational health and safety and nondiscrimination
Sweatfree IM RFP Sweatfree Independent Monitoring RFP • Executive Order 2004-4 • Anti-Sweatshop Procurement Policy prohibits Agencies from entering into procurement contracts for apparel and laundry services with companies that employ workers in sweatshop conditions. • Multi-state purchasing agreement with Ohio and Oregon. • The services will be required on an as-needed basis by various government and state agencies throughout the Commonwealth of Pennsylvania, Ohio and Oregon and other states that may elect to participate in the resulting contract. • DGS Statewide Contract available approximately July 2009
Reporting Requirements Admin. – Service Fee • DGS will issue all contracts for Apparel and Laundry Services including those under Procurement Handbook Thresholds. • Administrative Service Fee • 1% of total sales for the previous quarter • Quarterly Reports • Procurement activity for the Commonwealth of Pennsylvania. • Administrative Fee within thirty (30) days following the end of each quarter. • Failure to do so may result in breach of contract and may be cause for cancellation of contract for default.
0-$50,000 Statement of work (model) ITQ T&Cs Allow for mixed T&M and deliverables – Use established rate card for T&M work. T&M can not be greater than 40% of Purchase Order (PO) value Agency makes selection of supplier No Competitive solicitation required $100,000 cap per supplier in same category In same fiscal year by agency No limit on PO quantity To exceed $100K max requires waiver from DGS IT/ITQ 34
$50,001 - $250,000 Statement of work (model) ITQ T&Cs Allow for mixed T&M and deliverables – Use established rate card for T&M work. T&M can not be greater than 40% of PO value Expedited RFQ Process Sent to all suppliers in category Team selects based on best value Expected time from receipt of proposals: 2-3 weeks IT/ITQ 35
Greater than $250,000 Statement of work (model) 70% Rule in effect for technical ITQ T&Cs Allow for mixed T&M and deliverables – Use established rate card for T&M work. T&M can not be greater than 40% of PO value Standard RFQ Process (mimics RFP Process) Sent to all suppliers in category Agencies must request DGS delegation authority (Same as RFP requirement) Team selects based on best value Uses recommended percentage allocations Cost, DB, Technical (Same as RFP requirement) Minimum Point Allocations: Cost: 30%, MBE/WBE: 20% Technical provision IT/ITQ 36
IT/ITQ Master IT Services ITQ Process All IT procurements must comply with ITB EPM 003 37
IT/ITQ Essential Milestones March 2009 Grandfather letters out to current qualified IT ITQ suppliers April 10 2009 Agencies can solicit and award work under the new IT ITQ Will only solicit those suppliers who have returned signed contracts May 1 2009 Open enrollment for new suppliers begins Paper version of IT ITQ Questionnaire available on web site In agency library section of the IT ITQ website June 30 2009 All work must be completed under old IT Contract ITQ Waiver process in place. Requires CoP and DGS approval July 1 2009 Work begins under new contract 38
ITQ Timeline – Web Development Phase 1: Complete March 2009 Entire proposal, including client references, will be developed online No more hardcopy proposal Suppliers upload Questionnaire and necessary documents Phase 2: Complete April 2009 Company profile uploaded Agency view of qualified suppliers and their Company Profile Supplier proposals are evaluated and results posted Company profile will include existing functionality in current ITQ website Financial Data Rate Card Phase 3: Complete June 2009 Project Performance Evaluations by agencies 39
The end-user procedure contains detailed screen shots and instructions, but this checklist should be used by Purchasers when creating PO’s for invoicing plans. Invoicing Plan Procedures
Invoice Planning Important Notes: Invoicing Plan • Invoice Reference Field: The supplier relies on the information in the Reference Field to know how to apply the payment. Ensure the insertion of the machine serial number. The serial number can be found on the IKON’s Delivery and Acceptance Sheet.If this field is blank, the supplier will not know how to apply the payment. • ERS Box: Ensure the ERS box is checked or the vendor will not get paid. This is an auto populated field. DO NOT UNCHECK • Delivery Complete: Ensure the Delivery Complete Box is checked. You may now receive all 4 years upon the delivery of the machine. • Validity Start: This should always be the first day of the month after the machine is (expected to be) or received
PCI & PIBH • New PCI contracts released • 4400004305 • SRM header contract: • Order products/services from MSCC • 4400004576 • SRM regular contract • Order products/services that require a quote from PCI) • 4600013875 • SAP R/3 contract • Order inventoried products • New PIBH contracts going through release strategy • Three contracts (similar to PCI contracts) • DGS will email contract numbers to PPC upon final approval • New products • Plastic liners
PIBH • Before release of any solicitation, purchasing agency is to first offer materials and services referenced on Carve-Out List to PIBH • Agencies should be pro-active in reviewing new potential opportunities for PIBH • Early determination regarding PIBH’s involvement • Gives PIBH additional time to get qualifications in order • Reduces and/or eliminates delays in procurement process • PIBH materials available for purchase on office and janitorial supply contracts • PIBH gets preference over comparable items on other statewide contracts • Order PIBH trash liners directly from PIBH
LCB Oracle System COPA Executive Agencies LCB Supplier Registration SRM/SAP Oracle • LCB Oracle system went live March 1, 2009 • SRM supplier data was loaded into Oracle • Some supplier data did not transfer • Affected suppliers to complete a registration form • Suppliers will have separate Oracle supplier number • LCB POs will cross reference appropriate DGS contract numbers • LCB is sending limited correspondence to suppliers 44
Evaluated Receipt Settlement (ERS) Phase 1 Go-live: September 10, 2008 Suppliers: Ennis Paint Greenstar Allentown, LLC Statistics: 153 POs issued to date $4,992,112 • ERS Pilot Update Phase 2 Go-live: December 15, 2008 Suppliers: • Flor-Dri Supply Co • Larry’s Lumber Co Inc • Greenwood Manufacturing Inc Statistics: • 21 POs issued to date • $122,662 Reminder: When a supplier is set up for ERS it is done in the Supplier record; this will affect every PO or contract issued to that supplier. 45
Evaluated Receipt Settlement (ERS) 1. Log into R/3. 2. Select / Open ME23N (Purchase Order Display) Before reversing GRs on ERS purchase orders, users should verify if an Invoice Document has been generated. 46
Evaluated Receipt Settlement (ERS) 3. Click on Purchase Order on the menu bar at top of the screen and select “Other Purchase Order”. 4. Enter PO number and click on other document. 47
Evaluated Receipt Settlement (ERS) 5. Click on Purchase Order History tab in item details section (bottom section). 6. Click on the Invoice Receipt Material Document number to display the invoice document. 48
Evaluated Receipt Settlement (ERS) 7. Find the Reference Doc column (1) by scrolling to the right using the arrows (2) or scroll bar (3). 8. Note the GR (Reference Doc) number. 49
Evaluated Receipt Settlement (ERS) Compare the GR (Reference Doc) numbers on the Invoice Documents to each GR entered on the PO. If an Invoice Document does not exist for a specific GR (Reference Doc) the GR can be reversed If an Invoice Document does exist for a specific GR (Reference Doc) the GR can not be reversed 50